Student Loan Forgiveness Act of 2012

[PrattIAFF]

For all of those concerned with the mounting cost of higher education and the rising necessity of student loans to finance it, please sign this petition:

http://signon.org/sign/support-the-student-loan

Since 1980, average tuition for a 4-year college education has increased an astounding 827%. Since 1999, average student loan debt has increased by a shameful 511%.

In 2010, total outstanding student loan debt exceeded total outstanding credit card debt in America for the first time ever. In 2012, total outstanding student loan debt is expected to exceed $1 Trillion.

In short, student loan debt has become the latest financial crisis in America and, if we do absolutely nothing, the entire economy will eventually come crashing down again, just as it did when the housing bubble popped. Reasonable minds can disagree as to the solutions, they cannot, however, disagree on the existence of this ever-growing crisis, as well as the unsustainable course we're on towards financial oblivion.

As a result of more than 30 years of treating higher education as an individual commodity, rather than a public good and an investment in our collective future, those buried under the weight of their student loan debt are not buying homes or cars, not starting businesses or families, and they're not investing, inventing, innovating or otherwise engaged in any of the economically stimulative activities that we need all Americans to be engaged in if we're ever to dig ourselves out of the giant hole created by the greed of those at the very top.

Now for the good news: there's finally hope on the horizon! Representative Hansen Clarke of Michigan has just introduced H.R. 4170, the Student Loan Forgiveness Act of 2012, in the House of Representatives - legislation designed to lend a helping hand to those struggling under massive amounts of student loan debt.

For a brief summary of H.R. 4170's main provisions, please copy & paste this URL into your browser: http://tinyurl.com/7akydbk

To read the full version of the actual bill itself, please go here: http://tinyurl.com/6txure8

To read answers to some of the most frequently asked questions about the Student Loan Forgiveness Act of 2012, please go here: http://tinyurl.com/8xh4csd

Student loan debt has an undeniable and significant suppressive effect on economic growth. The Student Loan Forgiveness Act of 2012 directly addresses this enormous boot on the neck of the middle class and represents a glimmer of hope for millions of Americans who, with each passing day, find that the American Dream is more and more out of reach.

Therefore, we, the undersigned, respectfully request that Congress bring H.R. 4170, the Student Loan Forgiveness Act of 2012, up for consideration and commit to holding a straight, up-or-down vote on it this year. Thereafter, we, the undersigned, respectfully request that President Obama sign this legislation into law.

[PrattIAFF]

The Student Loan Forgiveness Act of 2012 | Rep. Hansen Clarke

Key Objectives:

1. Make student loan repayment both simple and fair

o The bill would create a new “10-10 standard” for student loan forgiveness.

 If you make payments equal to 10% of your discretionary income for 10 years, your remaining federal student loan debt would be forgiven.

 If you have already been making payments on your student loans, your repayment period would likely be shorter than 10 years. The amount you have already paid on your student loans over the past decade would be credited toward meeting the requirement for forgiveness.

o The bill would ensure low interest rates on federal student loans by capping them at 3.4%.

o The bill would allow existing borrowers whose educational loan debt exceeds their income to break free from the crushing interest rates of private loans by converting their private loan debt into federal Direct Loans, then enrolling their new federal loans into the 10/10 program.

o The bill would reward graduates for entering public service professions like teaching and firefighting. It would also provide incentives for medical professionals to work in underserved communities. It would reduce the Public Service Loan Forgiveness requirement to 5 years from its current 10 years.

Jumpstart the economy and create jobs

o The bill would increase millions of Americans’ purchasing power by forgiving debt, reducing loan repayment burdens, and cutting fees and interest rates. This would free many of these Americans to invest, buy homes, and start businesses.

o The bill would create jobs by increasing consumer demand for goods and services.

2. Send a lifeline to student borrowers who have fallen on difficult times

o Many Americans who have fallen behind on payments due to illness, unemployment, or divorce face continually rising interest rates and compounding fees with no hope of escape.

 The bill seeks to ensure that no one will be pushed into poverty because of a stroke of bad luck.

 Americans who are behind on their payments would be eligible to enroll in the new program and bring their payments down to 10% of discretionary income.

3. Promote financial responsibility in higher education

o While current borrowers would be eligible for full forgiveness under the plan, future borrowers would be subject to a $45,520 cap on forgiveness (based on the average overall cost of a four-year degree at a public university). The aim is to incentivize students to be mindful of educational costs and for colleges and universities to control tuition increases.

o Provisions of the bill itself would be financed by projected savings from Iraq and Afghanistan Overseas Contingency Operations; the bill would not affect funding for existing student aid programs.